Business interruption and supply chain issues, natural catastrophes and fires or explosions are the top three threats facing companies worldwide, according to the fourth annual Allianz Risk Barometer.

Cyber risks, which are grouped with data breaches and espionage, continue to surge up the top 10, ranking fifth this year, up from eighth last year.

In Australia, the top risk is business interruption and supply chain, followed by loss of reputation or brand value and intensified competition.

Market stagnation or decline makes the top 10 for the first time in Australia, reflecting growing economic concerns.

“The combination of the slowdown in China [and] the end of the investment stage of the mining boom… appear to have adversely affected business outlook for the Australian economy,” Allianz Australia’s GM Global Corporate & Specialty Holger Schaefer told insuranceNEWS.com.au.

Allianz says companies must adapt their planning to get a better grip on threats in today’s increasingly connected business environment.

“The root cause of many losses can often be traced back to the planning phase,” Allianz Global Corporate & Specialty CEO Chris Fischer Hirs said. “Identifying the impact of any interconnectivity early can mitigate or help prevent losses occurring.”

Companies are still not properly managing cyber risk, despite its rapid emergence as a major threat.

“The almost automatic blow to a company’s reputation following a cyber attack can have a dramatic impact on balance sheets,” the report says.

Financial services companies are investing to protect their operations, but the same cannot be said of other industries.

“It would be fair to say some other sectors and businesses are yet to fully appreciate the potential commercial impact of their cyber-risk vulnerabilities, and could be investing more,” Mr Schaefer said.

“However, we do recognise that company boards are taking an increasing interest in this topic and we do expect investment will increase, as well as more active risk management and risk transfer through insurance.”